China GDP: economy growing steadily but recovery ‘unstable and unbalanced’, top economic planner says

National Development and Reform Commission (NDRC) vice-chairman Ning Jizhe wrote in a People’s Daily commentary on Friday

Nomura earlier this week lowered its projection for China’s third-quarter growth to 5.1 per cent following 7.9 per cent growth in the second quarter

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Ning Jizhe is vice-chairman of China’s National Development and Reform Commission (NDRC). Photo: Simon Song

Published: 7:30pm, 6 Aug 2021Updated: 7:30pm, 6 Aug 2021

China’s economy is growing steadily, but the domestic recovery still remains unstable and unbalanced, a top official from the country’s economic planner said on Friday.

The world’s second-largest economy has, for the most part, recovered from disruptions caused by the coronavirus pandemic. However, manufacturers are still grappling with various challenges, including higher raw material prices, surging logistics costs and global supply-chain bottlenecks, meaning the pace of gross domestic product (GDP) growth is expected to moderate.

The new Delta variant outbreak, which started last month in Nanjing city and has since spread to several Chinese provinces, threatens to heap further downward pressure on the nation’s slowing retail spending.

Authorities have imposed lockdowns on a handful of cities, which also may worsen tourism and factory activities. Those factors, combined with the impact of flooding in central China last month, have analysts widely anticipating an exacerbated economic slowdown in the coming months.

“As the global pandemic wears on, the external environment is getting harsher and more complicated,” National Development and Reform Commission (NDRC) vice-chairman Ning Jizhe wrote in a People’s Daily commentary. “The domestic economic recovery still remains unstable and unbalanced, while momentum in demand growth is weak.”

China’s economy grew by 7.9 per cent in the second quarter of 2021, compared with a year earlier, and posted 12.7 per cent growth in the first half of the year. But it should be noted that those figures were against a low comparison base from a virus-hit 2020.

Looking forward, Nomura this week lowered its projection for China’s third-quarter growth to 5.1 per cent from 6.4 per cent previously.